安永的财富与资产管理领域的区块链创新英文-16页

1、Blockchaininnovation in wealth and assetmanagementBenefits and key challenges to adopting this technologyContentsOverview1What is a blockchain?2Applications of blockchain to wealth and asset management3Use case 1: client onboardingand profiling5Use case 2: model managementand trade order generation6

2、What are some challenges to adoption?8A practical approach to blockchain10Sample opportunity framework approach11What todo next?12IntroductionOverviewBlockchain, the underlying technology of bitcoin, is drawing significant focus and investments from many financial institutions in the industry. Given

3、 the technologys potential to both disrupt and enhance processes and systems, many firms have recently dedicated resources to understand and integrate blockchain into their businesses.Evolution of blockchaintechnologyBlockchain technology as we know it today emerged in January 2009 as the underlying

4、 technology of bitcoin. While bitcoin created initial noise in the financial world, blockchain technology gained prominence as a hot topic of discussion by itself.This article will discuss how wealth and assetmanagement firms are seeking out opportunities to harness the benefits of blockchain as wel

5、l as key challenges to adopting this technology. Further, the article will highlight near-term practical applications for blockchain and how to approach blockchain innovation.Continued developmentAs funding from venture capital firms continued to increase, what was considered the next generation of

6、blockchain technology emerged in 2014 to include “smart contracts.” The new programmable blockchains feature conditional logic, allowing contractual scenarios and terms to be coded.For example, a condition could bedesigned to release a defined amount of payment to participant A once participant B de

7、livered a specific asset.Blockchain innovation in wealth and asset management |1What is a blockchain?A blockchain is a shared record of all transactions and related information for a particular entity. This shared record a distributed ledger or database is visible by all parties with permission to t

8、he record. A blockchain comprises an ever-increasing set of transaction data blocks(see diagram below) that are verified by members of the network, traditionallyreferred to as “miners.”Each block is a set of transactions between two or more parties (e.g.,counterparty A pays counterparty B in exchang

9、e for an asset) and addedto the existing chain of blocks, creating a complete history of transactions. With each additional block, the entire distributed ledger is synchronized and agreed upon by all participant nodes. All nodes are continuously validating the transaction history, resulting in a blo

10、ckchain of immutable data.12342| Blockchain innovation in wealth and asset managementBlock 357New transactionsInception-to-date record of transactionsBlock 356New transactionsInception-to-date record of transactionsBlock 355New transactionsInception-to-date record of transactionsApplications ofblock

11、chain to wealth and asset managementBlockchain technology, also known as distributed ledgers, has a number of potential use cases within the wealth and asset management life cycle.Distributed ledgers are highly flexible; once implemented, they can be used to remove friction from the client onboardin

12、g process, streamline management of model portfolios, speed the clearing and settlement of trades, and easecompliance burdens associated with anti-money laundering (AML) and know your customer. The result is elimination of redundant functions, reduced operational expenses and increased opportunities

13、 to enhance the client experience. While blockchain technology is unlikely to replace current systems, it may be used to reconcile information across them or enable new infrastructure for new markets and products.By extension, these concepts can expand to broader applications, such asrollovers, trus

14、ts, estates, insurance and other transactions where assets are moved between parties or contracts are executed. A distributed ledger supports the validation and execution of a transaction in near real time. The client experience is enhanced and the process streamlined, and costs are reduced.Portfoli

15、o managementSocial mediaApplication of blockchain in wealth managementBlockchain can be leveraged to build a client profile in a much more efficient way. Storing client profile data on a blockchain allows for data points profile data, preferences, net worth, account information, social media profile

16、s to be shared as needed, with each individual block of data being stored securely, but permissioned for access by the individual (read, write, edit) as needed.Blockchain innovation in wealth and asset management |3Regulatory reportingAMLClient portfolioBanking and money movementFinancial planningUs

17、e case 1: client onboardingand profilingChallengesApproachBenefitsBlockchain innovation in wealth and asset management |5 Can facilitatemanykeyfunctions of onboarding: Can enhance or possiblyreplacetraditionalsystems, Client and risk profilingsuch as ACH and ACAT Financial planning Enables near-inst

18、antaneoustransfers of assets between Anti-money laundering checks and money movementfinancialinstitutionswithauthenticatedprovenanceoftracked changes Profile stored on a blockchain/distributed ledger Trustedparties are granted access to all or part of the profile based on cryptography New relationsh

19、ipswouldbeinitiated by profileowner Thesysteminherentlyenables an audittrailfortracking changes to the chain. As a result, processesrequiring fact-checking, such as AML, are simplified Integrate blockchain technologies into onboarding and ACH and ACAT systems and processes Strict onboardingrequireme

20、nts Proof ofidentification Residency Marital status Sources ofwealth Occupation Business interests Political ties Complying with numerousreporting requirements Information securityprocedures Ongoing monitoring of profiles Automated clearinghouse (ACH) and automated customeraccounttransfer(ACAT)syste

21、ms takemultipledaysandinvolvemanualprocesses using multiple systems and databasesKey driversBlockchain presents the possibility of revolutionizing client onboarding for wealth managers. In todays world, potential clients must provide proof of identification, residency, marital status, sources of wea

22、lth, occupation, business interests and political ties. Going through this process can take days or weeks to collect and verify the data.Use case 2: modelmanagementand trade order generationChallengesApproachBenefits6| Blockchain innovation in wealth and asset management Will allow other account tra

23、nsactions and trades to be Can reducetheamountofreconciliationneeded by shared more easilymovingfromthecurrentsegregatedmasterledger toa Canprovidenear-real-timeperformance,portfoliorisksecure, distributedoneanddriftdata, allowingmanagers to observemore Reducestheneedforsomeintermediatesresponsible

24、easilyand havegreaterinsightsfor settling and executing trades Investment managers would create and maintain a model similar to how they do it today. Modelscouldbetransmittedthroughablockchainto various subscribedbrokers. Individualaccountscanbeinvestedaccordingtothe model. Customization for restric

25、tions and other account-level constraints can be stored and applied. A wealth and asset manager using different platforms anddataarchitecturescausesdifficultiesindistributing, monitoring and updatingthird-party models. Firms must support redundant model management systems. Managersareoftenrequiredto

26、emailmodels to programsponsors or use proprietary portals.Key driversThe proliferation of open architecture investment offerings and the availability of third-party investment models in separately managed accounts have presented a number of operational challenges for wealth managers. Distributed led

27、ger technology would allow portfolio managers to instantly communicate portfolio changes to all clients “subscribed” to the model, as well as enable real-time views of individual account performance, drift outside of tolerances and cash flows. Also, smart contracts would allow for the management of

28、fees paid by the sponsors essentially taking a payment every time the model is used or downloaded.Technology allows the distributionof trusted value transfer and execution, allowing the disintermediation of intermediaries: the network becomes the intermediary.DistributedinfrastructureAllows the move

29、 frommaster ledgers, e.g., clearinghouses, banks. to distributedledgers with no intermediariesBlockchain innovation in wealth and asset management |7Whataresome challengesto adoption?Exploration of blockchain technology and its application to financial services firms is still in the early stages, an

30、d many wealth and asset management practitioners are not very familiar with how blockchain actually works or what the benefits might be. Additionally, there are many critics who claim that blockchain technology is “looking for a business problem to solve,” and we agree that business cases should dri

31、ve technology solutions, not the other way around.The chart below is based on 2016 EY research and indicates that scalability is expected tobeahurdleto industry-wideadoptionformanyorganizations. Todate,blockchain has seen limiteddeploymentin situationsrequiringlargevolumes of data, and thelinearnatu

32、re of thetechnologycallsintoquestion its ability to handlesuchavolume. In addition, firmsface product complexity limitations, as initial rollouts of complex products can be difficult to change later on the distributedledger.“Business casesshould drive technology solutions, not the other wayaround.”T

33、his comes as no surprise when current institutions are able to handle billions oftransactions with a high degree of reliability and security. Bitcoin blockchains, for example, can only achieve 7 transactions per second compared to Visas VisaNet, which currently achieves 50,000+ transactions per seco

34、nd.1Therearealsosignificantunknownsrelated to theregulatory and legalhurdlesthatexistinwealth and assetmanagement, such as thecustodialrequirementsif assetsareheld on a blockchainnetworkatanypoint.Otherbarrierstowidespreadadoptionincludedataprivacy and the high cost of replacing legacy infrastructur

35、es. Despite these challenges, EY believes that blockchain technology can be applied to solve business needs for wealth and asset management firms middle- and back-office internal processes first, before there can be widespread impacts to industry businessmodels.Which milestones must blockchain pass

36、before broadadoption would be possible at your organization?80%70%60%50%30%30%Technology Smartcontract Interoperability standardsstandardswith legacysystemsSuccessful DemonstratedSecurityproofability toof concept handle volume,resiliency, etc.Source: 2016EY Blockchain Capital Markets Roundtable.8| B

37、lockchain innovation in wealth and asset managementA practical approachto blockchainBlockchain is a difficult topic to understand, and determining a good business strategy for using it is even tougher. While many technologists can grasp the concept and the underlying algorithms, many business leader

38、s are unsure of how it can benefit their business in a meaningful way, or where it can disrupt current models. To accomplish this, EY recommends breaking strategy development into three key phases: first, identify the opportunities for the technology; then, focus on developing innovative solutions t

39、o capitalize on the opportunities; and, finally, work with your technology partners to successfully implement the solutions.The first step in developing a strategy is creating an opportunity framework to identifywhere the emerging benefits might exist and which areas of the business are the most vul

40、nerable to disruption. There are a handful of firms finding some early successes, and the ones that are making headway are taking a strategy-focused approach.We recommend that as firms examine the opportunities, they look internally first, as itis much easier to develop and gain adoption within your

41、 own firm. As smaller internal solutions begin to gain traction, firms should look to expand the solution internally across functional groups and then across lines of business to demonstrate efficacy and gain support and momentum. Finally, once internal support is obtained, business cases and develo

42、pment for altering existing revenue-generating business models should be examined.With so many potential blockchain opportunities, establishing an effective frameworkto identify real business value is critical. As noted in the previous section, there are use cases that can be developed quickly to dr

43、ive results. Firms should focus on those use cases that have the greatest opportunity with minimal risk, and use a framework to properly allocate time and resources. In addition to creating blockchain specific use cases, blockchain should be considered an enabling technology to the challenges of bus

44、iness-as-usual operations. To this point, firms should expect blockchain disruptors to emerge where operational overhead and data management issues exist or wherepotential revenue-generating opportunities are driven by transparency and ease of use.An opportunity assessment strategy at a minimum shou

45、ld contain the followingcomponents: The establishment of a framework for identifying the areas of opportunity andthreats and defining relevant use cases for analysis A team structure that includes key stakeholders, as well as select subject-matterexperts in the areas of concern (e.g., operations, pr

46、oduct management, technology, strategy) A communications plan for socializing findings and decision-making A prioritization matrix or framework for identifying key use cases for the executionroad map10 | Blockchain innovation in wealth and asset managementSample opportunityframework approachProcessB

47、usiness expertiseUse casesolutioningThe next logical step is to focus on developing solutions firston a small scale internally, but gradually ramping up to larger, more impactful internal and client-facing solutions. Several firms have adopted this approach through an innovation strategy. This strat

48、egy is usually defined as the process for assessing the opportunities previously identified in your analysis, determining the impacts to current business models and strategies, and creating solutions to take advantage of those opportunities and impacts.working in a vacuum can delay implementation, o

49、r possiblyresult in significant rework to integrate new solutions into existing systems and business processes. The most successful firms define the frameworks for innovation up front and then work within the prioritization set earlier to develop the solutions.It is also possible that the technology

50、 solution may not needto be developed in-house. There are currently dozens of blockchain technology providers, and more are launching on a regular basis. Once the concepts have been detailed during the innovation phase, the next step involves aligning the solution to your technology strategy and com

51、petencies. Many firms even some of the largest players in the wealth and asset management space are collaborating toimplementblockchain solutions; the largest consortiums in the space today (Hyperledger) include many firms that would normally build solutions in-house on their own.In several cases, f

52、irms have implemented an innovationstrategy through an “innovation lab,” where teams can focus on evaluating the opportunities and developing proofs of concept and working prototypes to explore the possibilities of blockchain. While some of these innovation labs start as individual, stand-alone grou

53、ps, many are developed with the idea that the output will eventually be integrated into the organizations business lines. Most firms now realize thatBlockchain innovation in wealth and asset management |11Objectives Establishaframeworkforuse case assessment Define business requirements and document

54、use cases identifiedduringframework Reviewandvalidateusecase assessment findings with key stakeholdersKey activities Define use case catalog Identifycrossfunctionalteam Perform preliminaryreviewof use case opportunities Identify in-house and external workshop participants Socialize, review and seek

55、approval from key stakeholders Conduct workshops with identified participants based on use cases identifiedfrom thepreliminaryopportunity review Groupandcategorizeusecase opportunities Socialize, review and seek approval from key stakeholders Identify use cases thatwarrant extendedsolutioninginthene

56、xt phase Reviewandagreeuponinitialuse case assessment with key stakeholders Conduct final workshops with identified participants Furtherdefineusecaseswith key participants Prioritizeusecaseassessments and summarize them for leadership Identifyandconfirmwithkey stakeholders use casesthat warrant exte

57、nded solutioningOutput Target requisite workshop participants List of preliminaryusecases/ assumptions List of key use cases/ assumptions for stakeholder presentation Presentation of keyfindings to stakeholders Detailed use caseassessment documentWhat to do next?With so much confusion regarding FinTech and blockchain, many firms are unsure of where to turn next and how to spend